ABENGOA. Innovative Technology Solutions for Sustainability. Consolidated condensed interim financial statements

Transcription

1 Innovative Technology Solutions for Sustainability

2 01 Consolidated condensed interim financial statements

3 01.1 Consolidated condensed statements of financial position as of September 30, 2014 and December 31, 2013

4 4 Consolidated condensed statements of financial position as of September 30, 2014 and December 31, Amounts in thousands of euros - Assets Note (1) 09/30/ /31/2013 Non-current assets Goodwill 498, ,059 Other intangible assets 349, ,052 Intangible assets 8 847, ,111 Property, plant & equipment 8 1,279,666 1,273,589 Concession assets in projects 9,890,702 8,573,243 Other assets in projects (project finance) 1,373,750 1,341,030 Fixed assets in projects (project finance) 9 11,264,452 9,914,273 Investments in associates carried under the equity method 1,148, ,682 Financial investments , ,230 Deferred tax assets 1,435,935 1,281,092 Total non-current assets 16,666,142 14,907,977 Current assets Inventories , ,981 Clients and other receivables 13 2,197,642 1,869,972 Financial investments 10 1,279, ,829 Cash and cash equivalents 2,971,215 2,951,683 6,792,548 6,078,465 Assets held for sale 7 372, ,403 Total current assets 7,165,467 6,244,868 Total assets 23,831,609 21,152,845 (1) Notes 1 to 26 are an integral part of these Consolidated Condensed Interim Financial Statements

5 5 Consolidated condensed statements of financial position as of September 30, 2014 and December 31, Amounts in thousands of euros - Equity and liabilities Note (1) 09/30/ /31/2013 Equity attributable to owners of the Parent Share capital 14 91,993 91,857 Parent company reserves 1,335,832 1,119,910 Other reserves (258,112) (160,456) Accumulated currency translation differences (436,634) (582,835) Retained earnings 813, ,378 Non-controlling interest 1,178, ,149 Total equity 2,724,165 1,893,003 Non-current liabilities Long-term non-recourse project financing 15 6,480,387 5,736,151 Corporate financing 16 4,890,912 4,735,145 Grants and other liabilities , ,188 Provisions for other liabilities and charges 84,194 78,044 Derivative liabilities , ,802 Deferred tax liabilities 372, ,304 Personnel liabilities 25 48,743 29,789 Total non-current liabilities 13,240,335 11,819,423 Current liabilities Short-term non-recourse project financing , ,799 Corporate financing 16 1,495, ,264 Trade payables and other current liabilities 18 5,046,088 5,514,186 Income and other tax payables 280, ,015 Derivative liabilities 11 43,859 44,380 Provisions for other liabilities and charges 9,094 9,506 7,576,040 7,319,150 Liabilities held for sale 7 291, ,269 Total current liabilities 7,867,109 7,440,419 Equity and liabilities 23,831,609 21,152,845 (1) Notes 1 to 26 are an integral part of these Consolidated Condensed Interim Financial Statements

6 01.2 Consolidated income statements for the nine month period ended September 30, 2014 and 2013

7 7 Consolidated interim income statements for the nine month periods ended September 30, 2014 and December 31, Amounts in thousands of euros - Nine-months ended Note (1) 09/30/ /31/2013 Revenue 5 5,236,766 5,232,761 Changes in inventories of finished goods and work in progress 53,549 14,757 Other operating income 153, ,554 Raw materials and consumables used (3,006,774) (3,186,540) Employee benefit expenses (656,970) (577,196) Depreciation, amortization and impairment charges 8 and 9 (368,531) (391,203) Other operating expenses (709,087) (839,970) Operating profit 702, ,163 Financial income 19 32,069 58,618 Financial expense 19 (616,859) (448,060) Net exchange differences 9,255 (2,537) Other financial income/(expense), net 19 (111,576) (26,721) Financial expense, net (687,111) (418,700) Share of profit (loss) of associates carried under the equity method 4,388 (3,472) Profit (loss) before income tax 19,445 46,991 Income tax benefit 20 72,710 43,410 Profit for the year from continuing operations 92,155 90,401 Profit (loss) from discontinued operations, net of tax 7 - (595) Profit for the year 92,155 89,806 Profit attributable to non-controlling interests 8,197 (17,043) Profit for the year attributable to the parent company 100,352 72,763 Weighted average number of ordinary shares outstanding (thousands) 833, ,063 Basic earnings per share from continuing operations ( per share) Basic earnings per share attributable to the parent company ( per share) Weighted average number of ordinary shares affecting the diluted earnings per share (thousands) 853, ,058 Diluted earnings per share from continuing operations ( per share) Diluted earnings per share attributable to the parent company ( per share) (1) Notes 1 to 26 are an integral part of these Consolidated Condensed Interim Financial Statements

8 01.3 Consolidated statements of comprehensive income for the nine month period ended September 30, 2014 and 2013

9 9 Consolidated statements of comprehensive income for the nine month periods ended September 30, 2014 and Amounts in thousand of euros - Nine-months ended 09/30/ /30/2013 Profit for the period 92,155 89,806 Items that may be subject to transfer to income statement: Change in fair value of available for sale financial assets 120 (222) Change in fair value of cash flow hedges (153,482) 75,618 Currency translation differences 194,702 (262,299) Tax effect 41,038 (22,403) Other movements - (6,292) Net income/(expenses) recognized directly in equity 82,378 (215,598) Cash flow hedges 21,058 71,302 Tax effect (6,317) (21,391) Transfers to income statement for the period 14,741 49,911 Other comprehensive income 97,119 (165,687) Total comprehensive income for the period 189,274 (75,881) Total comprehensive income attributable to non-controlling interest (40,377) 24,397 Total comprehensive income attributable to the parent company 148,897 (51,484) Total comprehensive income attributable to the parent company from continuining operations 148,897 (50,127) Total comprehensive income attributable to the parent company from discontinued operations - (1,357)

10 01.4 Consolidated statements of changes in equity for the nine month period ended September 30, 2014 and 2013

11 11 Consolidated statements of changes in equity for the nine month periods ended September 30, 2014 and Amounts in thousands of euros - Share capital Attributable to the Owners of the Company Parent company Accumulated Retained and other currency transaltion earnings reserves differences Total Non-controlling interest Total equity Balance at December 31, , ,140 (167,380) 847,251 1,118, ,208 1,860,363 Profit for the period after taxes ,763 72,763 17,043 89,806 Change in fair value of available for sale financial assets - (256) - - (256) 34 (222) Change in fair value of cash flow hedges - 146, , ,920 Currency transalation differences - - (220,395) - (220,395) (41,904) (262,299) Tax effect - (43,685) - - (43,685) (109) (43,794) Other movements - (6,292) - - (6,292) - (6,292) Other comprehensive income (loss) - 96,148 (220,395) - (124,247) (41,440) (165,687) Total comprehensive income (loss) - 96,148 (220,395) 72,763 (51,484) (24,397) (75,881) Treasury shares - (84,118) - - (84,118) - (84,118) Capital decrease (1,072) 1, Distribution of 2012 profit - 76,755 - (115,496) (38,741) - (38,741) Transactions with owners (1,072) (6,291) - (115,496) (122,859) - (122,859) Acquisitions ,783 1,783 (9,490) (7,707) Capital increase in subsidiaries with non-controlling interest ,617 36,617 Scope variations and other movements ,788 22,788 (5,381) 17,407 Scope variations, acquisitions and other movements ,571 24,571 21,746 46,317 Balance at September 30, , ,997 (387,775) 829, , ,557 1,707,940 Balance at December 31, , ,454 (582,835) 852,378 1,320, ,149 1,893,003 Profit for the period after taxes , ,352 (8,197) 92,155 Change in fair value of available for sale financial assets (3) 120 Change in fair value of cash flow hedges - (132,576) - - (132,576) 152 (132,424) Currency transalation differences - 146, ,201 48, ,702 Tax effect - 34, ,797 (76) 34,721 Other comprehensive income (loss) - (97,656) 146,201-48,545 48,574 97,119 Total comprehensive income (loss) - (97,656) 146, , ,897 40, ,274 Treasury shares - (478) - - (478) - (478) Capital increase 952 (2,266) - - (1,314) - (1,314) Capital decrease (816) (7) - (7) Distribution of 2013 profit - 154,963 - (194,020) (39,057) - (39,057) Transactions with owners ,028 - (194,020) (40,856) - (40,856) Acquisitions (29,318) (29,318) - (29,318) Capital increase in subsidiaries from minority interest ,070 86, , ,511 Change in conditions of conversion option in convertible bonds - 62,894-62,894-62,894 Scope variations and other movements (2,440) (2,440) (14,903) (17,343) Scope variations, acquisitions and other movements - 62,894-54, , , ,744 Balance at September 30, ,993 1,077,720 (436,634) 813,022 1,546,101 1,178,064 2,724,165 Notes 1 to 26 are an integral part of these Consolidated Condensed Interim Financial Statements

12 01.5 Consolidated condensed cash flow statements for the nine month period ended September 30, 2014 and 2013

13 13 Consolidated condensed cash flow statements for the nine month periods ended September 30, 2014 and Amounts in thousands of euros - Nine-months ended Note (1) 09/30/ /30/2013 I. Profit for the period from continuing operations 92,155 90,401 Non-monetary adjustments 779, ,482 II. Profit for the period from continuing operations adjusted by non monetary items 871, ,883 III. Variations in working capital and discontinued operations (821,325) (117,267) Income tax received (paid) 2,496 11,701 Interest paid (555,360) (367,804) Interest received 17,272 28,265 Discontinued operations - 34,539 A. Net cash provided by operating activities (485,730) 285,317 Intangible assets and property, plant & equipment 5 (1,302,232) (1,185,568) Other (investments) and disinvestments (397,301) 52,567 Discontinued operations - (27,848) B. Net cash used in investing activities (1,699,533) (1,160,849) Initial Public Offering of subsidiaries ,036 - Other disposals and repayments 1,527, ,687 C. Net cash provided by financing activities 2,138, ,687 Net increase/(decrease) in cash and cash equivalents (47,208) (187,845) Cash, cash equivalents and bank overdrafts at beginning of the period 2,951,683 2,413,183 Transaltion differences cash or cash equivalent 67,919 (61,019) Assets held for sale (1,179) - Discontinued operations - (76,368) Cash and cash equivalents at end of the period 2,971,215 2,087,951 (1) Notes 1 to 26 are an integral part of these Consolidated Condensed Interim Financial Statements

14 01.6 Notes to the consolidated condensed interim financial statements for the nine month period ended September 30, 2014

15 15 Contents Note 1.- General information Note 2.- Basis of presentation Note 3.- Critical accounting policies 18 Note 4.- Financial risk management 19 Note 5.- Financial information by segment Note 6.- Changes in the composition of the group Note 7.- Discontinued operations and Non-current assets held for sale Note 8.- Intangible assets and property, plant & equipment Note Fixed assets in projects (project finance) Note 10.- Financial investments Note 11.- Derivative financial instruments Note 12.- Inventories Note 13.- Clients and other receivable accounts Note 14.- Share capital Note 15.- Non-recourse financing (project financing) Note 16.- Corporate financing Note 17.- Grants and other liabilities Note 18.- Trade payables and other current liabilities Note 19.- Finance income and expenses Note 20.- Income tax Note 21.- Fair value of financial instruments Note 22.- Earnings per share Note 23.- Average number of employees Note 24.- Transactions with related parties Note 25.- Employee remuneration and other benefits Note 26.- Subsequent events... 47

16 16 Notes to the Consolidated Condensed Interim Financial Statements for the nine month period ended September 30,, 2014 Note 1.- General information Abengoa, S.A. is the parent company of the Abengoa Group (referred to hereinafter as Abengoa, the Group or the Company ), which at the end of the nine month period ended September 30, 2014, included 650 companies: the parent company itself, 603 subsidiaries, 20 associates and 26 joint ventures. Abengoa, S.A. was incorporated in Seville, Spain on January 4, 1941 as a Limited Liability Company and was subsequently transformed into a Limited Liability Corporation ( S.A. in Spain) on March 20, Its registered office is Campus Palmas Altas, C/ Energía Solar nº 1, Seville. Abengoa s shares are represented by class A and B shares which are listed on the Madrid and Barcelona Stock Exchanges and on the Spanish Stock Exchange Electronic Trading System (Electronic Market). Class A shares have been listed since November 29, 1996 and class B shares since October 25, Additionally, Class B shares are also listed on the NASDAQ Global Select Market in the form of American Depositary Shares from October 29, 2013 because of the capital increase carried out in October The Company presents mandatory financial information quarterly and semiannually. Following the initial public offering of our subsidiary Abengoa Yield (see Note 6.2), on which Abengoa currently holds a 64.28% interest, Abengoa Yield s shares are also listed in the NASDAQ Global Select Market from June 13, Abengoa is an international company that applies innovative technology solutions for sustainability in the energy and environment sectors, generating electricity from renewable resources, converting biomass into biofuels and producing drinking water from sea water. The Company supplies engineering projects under the turnkey contract modality and operates assets that generate renewable energy, produce biofuel, manage water resources, desalinate sea water and treat sewage. Abengoa`s activity and the internal and external management information are organized under the following three activities: Engineering and construction: includes our traditional engineering activities in the energy and water sectors, with more than 70 years of experience in the market and the development of thermo-solar technology. Abengoa is specialized in carrying out complex turn-key projects for thermo-solar plants, solar-gas hybrid plants, conventional generation plants, biofuels plants and water infrastructures, as well as large-scale desalination plants and transmission lines, among others. Concession-type infrastructures: groups together the company s extensive portfolio of proprietary concession assets that generate revenues governed by long term sales agreements, such as take-or-pay contracts, tariff contracts or power purchase agreements. This activity includes Abengoa Yield, the operation of electric (solar, cogeneration or wind) energy generation plants and transmission lines. These assets generate low demand risk and the Company focuses on operating them as efficiently as possible. Industrial production: covers Abengoa s businesses with a commodity component, such as biofuels and industrial waste recycling (until the sale of shareholding in Befesa Medio Ambiente, S.L.U. (Befesa), see Note 7.3). The Company holds an important leadership position in these activities in the geographical markets in which it operates. The Consolidated Condensed Interim Financial Statements for the period ended on September 30, 2014 were formulated on November 13, Translation of financial statements originally issued in Spanish and prepared in accordance with International Financial Reporting Standards adopted by the European Union. In the event of a discrepancy, the Spanish-language version prevails.

17 17 Note 2.- Basis of presentation The Group's consolidated financial statements corresponding to the fiscal year ended December 31, 2013 were prepared by the Directors of the Company in accordance with International Financial Reporting Standards adopted by the European Union, applying the principles of consolidation, accounting policies and valuation criteria described in Note 2 of the notes to the aforementioned consolidated financial statements, so that they present the Group s equity and financial position as of December 31, 2013 and the consolidated results of its operations, the changes in the consolidated net equity and the consolidated cash flows for the financial year ending on that date. The Group s consolidated financial statements corresponding to the 2013 financial year were approved by the General Shareholders Meeting of the Parent Company held on April 6, These Consolidated Condensed Interim Financial Statements are presented in accordance with IAS 34, Financial Reporting approved by the European Union. These Consolidated Condensed Interim Financial Statements have been prepared based on the accounting records of Abengoa and the subsidiary companies which are part of the Group, and include the adjustments and re-classifications necessary to achieve uniformity between the accounting and presentation criteria followed by all the companies of the Group (in all cases, in accordance with local regulations) and those applied by Abengoa, S.A. for the purpose of preparing consolidated financial statements. In accordance with IAS 34, financial information is prepared solely in order to update the most recent annual consolidated financial statements prepared by the Group, placing emphasis on new activities, occurrences and circumstances that have taken place during the nine month period ended September 30, 2014 and not duplicating the information previously published in the annual consolidated financial statements for the year ended December 31, Therefore, the Consolidated Condensed Interim Financial Statements do not include all the information that would be required in complete consolidated financial statements prepared in accordance with the International Financial Reporting Standards as issued by the EU. In view of the above, for an adequate understanding of the information, these Consolidated Condensed Interim Financial Statements must be read together with Abengoa s consolidated financial statements for the year ended December 31, Given the activities in which the companies of the Group engage, their transactions are not of a cyclical or seasonal nature. For this reason, specific breakdowns are not included in these explanatory notes to the Consolidated Condensed Interim Financial Statements corresponding to the nine month period ending on September 30, In determining the information to be disclosed in the notes to the Consolidated Condensed Interim Financial Statements, the Group, in accordance with IAS 34, has taken into account its materiality in relation to the Consolidated Condensed Interim Financial Statements. The amounts included within the documents comprising the Consolidated Condensed Interim Financial Statements (Consolidated Condensed Statement of Financial Position, Consolidated Income Statement, Consolidated Statement of Comprehensive Income, Consolidated Statement of Changes in Equity, Consolidated Condensed Cash Flow Statement and notes herein) are, unless otherwise stated, all expressed in thousands of Euros ( ). Unless otherwise stated, any presented percentage of interest in subsidiaries, joint ventures (including temporary joint operations) and associates includes both direct and indirect ownership Application of new accounting standards a) Standards, interpretations and amendments effective from January 1, 2014 under IFRS-EU, applied by the Group: IAS 32 (Amendment) Offsetting of financial assets and financial liabilities. The IAS 32 amendment is mandatory for periods beginning on or after January 1, 2014 under IFRS-EU and under the IFRS approved by the International Accounting Standards Board, hereinafter IFRS-IASB, and is to be applied retroactively. IAS 36 (Amendment) Recoverable Amount Disclosures for Non-Financial Assets. The IAS 36 amendment is mandatory for periods beginning on or after January 1, 2014 under IFRS-EU and IFRS-IASB.

18 18 IAS 39 (Amendment) Novation of Derivatives and Continuation of Hedge Accounting. The IAS 39 amendment is for periods beginning on or after January 1, 2014 under IFRS-EU and IFRS-IASB. The applications of these amendments have not had any material impact on these Consolidated Condensed Interim Financial Statements. b) In preparing these Consolidated Condensed Interim Financial Statements as of September 30, 2014, the Group has applied the following new standards and amendments that came into effect on January 1, 2014 under IFRS-IASB, and which have been applied early under IFRS-EU: IFRIC 21 (Interpretation) Levies. The IFRIC 21 is mandatory for periods beginning on or after January 1, 2014 under IFRS-IASB and for periods beginning on or after June 17, 2014 under IFRS EU. The amendments and interpretations effective from January 1, 2014 have not had any significant impact on these Consolidated Condensed Interim Financial Statements. c) Standards, interpretations and amendments published by the IASB that will be effective for periods after September 30, 2014: Annual Improvements to IFRSs and cycles. These improvements are mandatory for periods beginning on or after July 1, 2014 under IFRS-IASB and have not yet been adopted by the EU. IFRS 9 Financial Instruments. This Standard will be effective from January 1, 2018 under IFRS-IASB and has not yet been adopted by the EU. IFRS 15 Revenues from contracts with Customers. IFRS 15 is applicable for periods beginning on or after 1 January Earlier application is permitted. IFRS 15 has not yet been adopted by the EU. IAS 16 (Amendment) Property, Plant and Equipment and IAS 38 Intangible Assets, regarding to acceptable methods of amortization and depreciation. This amendment is mandatory for periods beginning on or after January 1, 2016 under IFRS-IASB, earlier application is permitted, and has not yet been adopted by the EU. IFRS 11 (Amendment) Joint Arrangements This amendment is mandatory for periods beginning on or after January 1, 2016 under IFRS-IASB, earlier application is permitted, and has not yet been adopted by the EU. The Group is currently in the process of evaluating the impact on the Consolidated Condensed Interim Financial Statements derived from the application of the new standards and amendments that will be effective for periods beginning after September 30, Note 3.- Critical accounting policies The Accounting Policies followed in these Consolidated Condensed Interim Financial Statements are consistent with those established in Abengoa's Consolidated Financial Statements as of December 31, 2013 which are described in Note 2 to such Consolidated Financial Statements. In Abengoa s Consolidated Condensed Interim Financial Statements corresponding to the nine month period ended September 30, 2014 estimates and assumptions have been made by the Management of the Group and the Management of the consolidated subsidiaries (and subsequently verified by their Directors), in order to quantify some of the assets, liabilities, income, expenses and commitments recorded therein. The most critical accounting policies that involve estimations are as follows: Impairment of intangible assets and goodwill. Revenue from construction contracts. Concession agreements.

19 19 Income taxes and recoverable amount of deferred tax assets. Derivatives and hedging. A full description of the above mentioned critical accounting estimates and judgments is provided in Note 3 to the Abengoa s Consolidated Financial Statements as of December 31, Although these estimates and assumptions are made using all available facts and circumstances, it is possible that future events may require management to amend such estimates and assumptions in future periods. Changes in accounting estimates are recognized prospectively, in accordance with IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors, in the Consolidated Income Statement of the year in which the change occurs. During the first nine months of 2014, in opinion of the Directors there were no significant changes to the estimates made at the end of Note 4.- Financial risk management Abengoa s activities undertaken through its operating segments are exposed to various financial risks: market risk (including currency risk, interest rate risk and price risk), credit risk, liquidity risk and capital risk. The risk management model attempts to minimize the potential adverse impact of such risks upon the Group s financial performance. Risk is managed by the Group s Corporate Finance Department, which is responsible for identifying and evaluating financial risks in conjunction with the Group s operating segments, quantifying them by project, region and company. Additionally, the sources of finance are diversified, in an attempt to prevent concentrations that may affect our liquidity risk. Written internal risk management policies exist for global risk management, as well as for specific areas of risk, such as foreign exchange risk, credit risk, interest rate risk, liquidity risk, the use of hedging instruments and derivatives and the investment of cash surpluses. In addition, there are official written management regulations regarding key controls and control procedures for each company and the implementation of these controls is monitored through internal audit procedures. These Consolidated Condensed Interim Financial Statements do not include all financial risk management information and disclosures required for annual financial statements, and should be read together with the information included in Note 4 to Abengoa s Consolidated Financial Statements as of December 31, Note 5.- Financial information by segment 5.1. Information by business segment As indicated in Note 1, Abengoa s activity is grouped under the following three activities which are in turn composed of seven operating segments (eight operating segments until the sale our stake in Befesa, see Note 7.3). Engineering and construction; includes our traditional engineering business in the energy and water sectors, with more than 70 years of experience in the market as well as the development of solar technology. Since the beginning of 2014, this activity comprises one operating segment Engineering and Construction (previously, the operating segment of Technology and Others was also included. Since 2014, it is included in the operating segment of Engineering and Construction, in accordance with IFRS 8 Operating Segment ). Abengoa specializes in carrying out complex turn-key projects for thermo-solar plants, solar-gas hybrid plants, conventional generation plants, biofuels plants and water infrastructures, as well as large-scale desalination plants and transmission lines, among others. In addition, this segment includes activities related to the development of thermo-solar technology, water management technology and innovative technology businesses such as hydrogen energy or the management of energy crops.

20 20 Concession-type infrastructures; groups together the company s proprietary concession assets that generate revenues governed by long term sales agreements, such as take-or-pay contracts or power purchase agreements. This activity is included in the operating segment of Abengoa Yield (ABY), the operation of electric (solar, cogeneration or wind) energy generation plants, desalination plants and transmission lines. These assets generate low demand risk and we focus on operating them as efficiently as possible. During June 2014, the Company listed one of its subsidiaries, Abengoa Yield Plc. in the US (ABY). ABY groups ten assets previously reported in different operating segments within the Concession-type infrastructures activity. As such, ABY has become a new operating segment within the activity of Concessions. Abengoa currently holds a 64.3% stake in ABY. As a result, the Concession-type infrastructures activity currently comprises five operating segments: Solar Operation and maintenance of solar energy plants, mainly using thermo-solar technology. Transmission Operation and maintenance of high-voltage transmission power line infrastructures. Water Operation and maintenance of facilities aimed at generating, transporting, treating and managing water, including desalination and water treatment and purification plants. Cogeneration and other Operation and maintenance of conventional cogeneration electricity plants. Abengoa Yield Management, ownership and acquisition of renewable energy, conventional power, electric transmission lines and other concession-type revenue-generating assets. Currently Abengoa Yield owns and manages 10 concessional assets and has a right of first offer on any proposed sale from Abengoa over certain assets. Industrial production; covers Abengoa s businesses with a commodity component, such as biofuels (industrial waste recycling was part of this activity until the sale of our stake in Befesa, at the end of 2013, see Note 7.3). The company holds an important leadership position in these activities in the geographical markets in which it operates. This activity is comprised of one operating segment: Biofuels Production and development of biofuels, mainly bioethanol for transport, which uses cellulosic plant fiber, cereals, sugar cane and oil seeds (soya, rape and palm) as raw materials. Prior period segment financial information has been restated to conform to the new structure, according to IFRS 8 Operating Segments. Abengoa s Chief Operating Decision Maker ( CODM ) assesses the performance and assignment of resources according to the above identified segments. The CODM in Abengoa considers the revenues as a measure of the activity and the EBITDA (Earnings before interest, tax, depreciation and amortization) as measure of the performance of each segment. In order to assess performance of the business, the CODM receives reports of each reportable segment using revenues and EBITDA. Net interest expense evolution is assessed on a consolidated basis given that the majority of the corporate financing is incurred at the holding level and that most investments in assets are held at project companies which are financed through non-recourse project finance. The depreciation, amortization and impairment charges are assessed on a consolidated basis in order to analyze the evolution of net income and to determine the dividend pay-out ratio. These charges are not taken into consideration by CODM for the allocation of resources because they are non-cash charges. The process to allocate resources by the CODM takes place prior to the award of a new project. Prior to presenting a bid, the company must ensure that the non-recourse financing for the new project has been obtained. These efforts are taken on a project by project basis. Once the project has been awarded, its evolution is monitored at a lower level and the CODM receives periodic information (revenues and EBITDA) on each operating segment s performance.

21 21 a) The following table shows the Segment Revenues and EBITDA for the nine month period ended September 30, 2014 and 2013: Revenue Ebitda For the nine months ended For the nine months ended Item Engineering and construction Engineering and construction 3,089,680 3,253, , ,299 Total 3,089,680 3,253, , ,299 Concession-type infraestructure Solar 265, , , ,674 Water 31,123 30,561 20,249 22,110 Transmission lines 51,009 40,088 32,949 26,573 Cogeneration and other 22,325 35,939 3,712 5,504 Abengoa Yield 199,021 95, ,688 63,345 Total 569, , , ,206 Industrial production Biofuels 1,577,876 1,566, ,324 80,861 Total 1,577,876 1,566, ,324 80,861 Total 5,236,766 5,232,761 1,070, ,366 The reconciliation of segment EBITDA with the profit attributable to owners of the parent company is as follows: For the nine months ended For the nine months ended Line Total segment EBITDA 1,070, ,366 Amortization and depreciation (368,531) (391,203) Financial expenses net (687,111) (418,700) Share in profits/ (losses) of associates 4,388 (3,472) Income tax expense 72,710 43,410 Profit (loss) from discontinued operations, net of tax - (595) Profit attributable to non-controlling interests 8,197 (17,043) Profit attributable to the parent company 100,352 72,763

22 22 b) The long term assets and liabilities by Segment as of September 30, 2014 and December 31, 2013 are as follows: Engineering and construction Concession-type infrastructure Industrial production Item Eng. and const. Solar Trans. Water Cog. and other Abengoa Yield Biofuels Balance as of Assets allocated Intangible assets 358, ,078 2, , ,713 Property plant and equipment 264,647 23, , ,377 1,279,666 Fixed assets in projects - 3,034,054 2,355, , ,452 3,402,909 1,023,868 11,264,452 Current financial investments 782, ,399 25, , ,521 1,279,280 Cash and cash equivalents 1,750, ,209 32,787 19,828 17, , ,926 2,971,215 Subtotal allocated 3,155,528 3,460,185 2,413, , ,414 3,786,974 3,326,764 17,642,326 Unallocated assets Non-current and associated financ. invest ,838,376 Deferred tax assets ,435,935 Other current assets ,542,053 Assets held for sale ,919 Subtotal unallocated ,189,283 Total Assets ,831,609 Engineering and construction Concession-type infrastructure Industrial production Item Eng. and const. Solar Trans. Water Cog. and other Abengoa Yield Biofuels Balance as of Liabilities allocated L-T and S-T corpor. financing 1,738,014 1,293, , ,581-2,730,641 6,228,634 L-T and S-T non rec. financing 172,321 2,101,495 1,713, , ,504 1,962, ,816 7,181,757 L-T and S-T lease liabilities 15, ,504 35,597 Subtotal allocated 1,925,428 3,394,515 2,071, , ,085 1,962,523 3,208,961 13,445,988 Unallocated liabilities L-T Other loans and borrowings ,086 L-T grants and other liabilities ,991 Provisions and contingencies ,288 L-T derivative financial instruments ,050 Deferred tax liabilities ,058 L-T personnel liabilities ,743 Other current liabilities ,370,171 Liabilities held for sale ,069 Subtotal unallocated ,661,456 Total liabilities ,107,444 Equity unallocated ,724,165 Total liabilities and equity unallocated ,385,621 Total liabilities and equity ,831,609

23 23 Engineering Industrial and Concession-type infrastructure production construction Cog. and Abengoa Balance as of Eng. and const. Solar Trans. Water Biofuels Item other Yield Assets allocated Intangible assets 378, ,078 2, , ,111 Property plant and equipment 230,198 31, ,941-1,000,694 1,273,589 Fixed assets in projects - 2,731,344 2,091, , ,604 3,213, ,991 9,914,273 Current financial investments 574,399 17,297 82,284 9,923 34, ,949 77, ,829 Cash and cash equivalents 1,537, ,832 50,578 35,369 4, , ,254 2,951,683 Subtotal allocated 2,720,479 2,977,725 2,224, , ,012 3,603,454 3,398,900 15,907,485 Unallocated assets Non-current and associated financ. invest ,596,912 Deferred tax assets ,281,092 Other current assets ,200,953 Assets held for sale ,403 Subtotal unallocated ,245,360 Total Assets ,152,845 Engineering Industrial and Concession-type infrastructure production construction Cog. and Abengoa Balance as of Eng. and const. Solar Trans. Water Biofuels Item other Yield Liabilities allocated L-T and S-T corpor. financing 1,588,500 1,137, ,812-2,536-2,648,987 5,490,598 L-T and S-T non rec. financing 160,463 1,895,616 1,254, , ,870 2,103, ,352 6,320,950 L-T and S-T lease liabilities 19, ,791 40,038 Subtotal allocated 1,768,210 3,033,379 1,367, , ,406 2,103,058 3,137,130 11,851,586 Unallocated liabilities L-T Other loans and borrowings ,773 L-T grants and other liabilities ,188 Provisions and contingencies ,550 L-T derivative financial instruments ,802 Deferred tax liabilities ,304 L-T personnel liabilities ,789 Other current liabilities ,805,581 Liabilities held for sale ,269 Subtotal unallocated ,408,256 Total liabilities ,259,842 Equity unallocated ,893,003 Total liabilities and equity unallocated ,301,259 Total liabilities and equity ,152,845 The criteria used to obtain the assets and liabilities per segment, are described as follows: _ With the only objective of presenting liabilities by segment, Corporate Financing signed by Abengoa, S.A. and Abengoa Finance, S.A.U. has been allocated by segments (see Note 16), since its main purpose is to finance investments in projects and companies that needed to expand their businesses and lines of activity.

24 24 c) Net Debt by segment as of September 30, 2014 and December 31, 2013 is as follows: Engineering Industrial and Concession-type infrastructure production construction Eng. and Cog. and Abengoa Balance as Solar Trans. Water Biofuels Item const. other Yield of Bank debt and current/non-curr. bond 1,738,014 1,293, , ,581-2,730,641 6,228,634 L-T and S-T non rec. financing 172,321 2,101,495 1,713, , ,504 1,962, ,816 7,181,757 Obligat. under curr./non-curr. financial lease 15, ,504 35,597 Current financial investments (782,085) (177,399) (25,284) (315) (4) (190,672) (103,521) (1,279,280) Cash and cash equivalents (1,750,146) (225,209) (32,787) (19,828) (17,926) (193,393) (731,926) (2,971,215) Total net debt (cash) (606,803) 2,991,907 2,013, , ,155 1,578,458 2,373,514 9,195,493 Engineering Industrial and Concession-type infrastructure production construction Eng. and Cog. and Abengoa Balance as Solar Trans. Water Biofuels Item const. other Yield of Bank debt and current/non-curr. bond 1,588,500 1,137, ,812-2,536-2,648,987 5,490,598 L-T and S-T non rec. financing 160,463 1,895,616 1,254, , ,870 2,103, ,352 6,320,950 Obligat. under curr./non-curr. financial lease 19, ,791 40,038 Current financial investments (574,399) (17,297) (82,284) (9,923) (34,638) (129,949) (77,339) (925,829) Cash and cash equivalents (1,537,418) (196,832) (50,578) (35,369) (4,378) (259,854) (867,254) (2,951,683) Total net debt (cash) (343,607) 2,819,250 1,234, , ,390 1,713,255 2,192,537 7,974,074 In order to obtain Net Debt, by segment: 1. With the only objective of presenting liabilities by segment, Corporate Financing signed by Abengoa, S.A. and Abengoa Finance, S.A.U. has been allocated by operating segment (see Note 16), since its main purpose is to finance investments in projects and companies that needed to expand their businesses and lines of activity. 2. Short-term financial investments and Cash and cash equivalents are presented reducing debt, since both items are considered highly liquid, even though short-term financial investments do not fulfill all the conditions to be classified as cash and cash equivalents.

25 25 d) The Capex by segments for the nine month period ended September 30, 2014 and 2013 is as follows: For the nine months ended For the nine months ended Item Engineering and construction Engineering and construction 74,435 83,114 Total 74,435 83,114 Concession-type infraestructure Solar 359, ,345 Water 35,349 65,266 Transmission lines 312, ,412 Cogeneration and other 401,648 95,687 Yieldco 27, ,116 Total 1,136,524 1,050,826 Industrial production Biofuels 91,273 51,628 Total 91,273 51,628 Total 1,302,232 1,185,568 e) The distribution of depreciation, amortization and impairment charges by segments for the nine month period ended September 30, 2014 and 2013 is as follows: For the nine months ended For the nine months ended Item Engineering and construction Engineering and construction 54, ,375 Total 54, ,375 Concession-type infraestructure Solar 69,498 67,140 Water 2,813 6,768 Transmission lines 21,535 16,155 Cogeneration and other 15,257 9,019 Yieldco 64,213 32,728 Total 173, ,810 Industrial production Biofuels 140, ,018 Total 140, ,018 Total 368, ,203

26 Information by geographic areas The revenue distribution by geographical region for the nine month period ended September 30, 2014 and 2013 is as follows: For the nine ne months ended For the nine months ended Geographical region % % - North America 1,894, ,935, Latin America (except Brazil and Mexico) 766, , Brazil 514, , Europe (except Spain) 658, , Other regions 561, , Spain 841, , Consolidated Total 5,236, ,232, Outside Spain amount 4,395, ,267, Spain amount 841, , In the nine month period ended September 30, 2013 we reported results from Mexico as part of Latin America. In the nine month period ended September 30, 2014, in order to better reflect the geographical segmentation of our business we included results from Mexico in the North America segment. The information by geographic areas for the period ended September 30, 2013 has been presented according to the new geographic segmentation. Note 6.- Changes in the composition of the group 6.1. Changes in i the consolidation group During the nine month period ended September 30, 2014, 79 subsidiaries, 2 associates and 3 joint ventures were added to the consolidation perimeter of the group. In addition, 10 subsidiaries, 1 associate and 1 joint venture were no longer included in the consolidation group. These changes did not have a significant impact on these Consolidated Condensed Interim Financial Statements Initial Public Offering of Abengoa Yield Plc. On June 18, 2014 Abengoa Yield Plc. ( Abengoa Yield ), a wholly-owned subsidiary of Abengoa, closed its initial public offering of 28,577,500 ordinary shares, including the exercise in full of the option to purchase additional shares to cover over-allotment by the underwriters of the initial public offering ( greenshoe option ). These shares were offered at a price of US$29 per share for total gross proceeds of US$828.7 million ( million) before fees and all the expenses related to the initial public offering. Abengoa Yield s shares began trading on the NASDAQ Global Select Market under the symbol ABY on June 13, Abengoa Yield is a dividend growth-oriented company formed to serve as the primary vehicle through which Abengoa will own, manage and acquire renewable energy, conventional power and electric transmission lines and other contracted revenue-generating assets, initially focused on North America and South America, as well as Europe.

27 27 Abengoa Yield Limited was incorporated on December 17, On March 17, 2014, the General Shareholders Meeting approved its conversion to Plc, with effect on March 19, Prior to the closing of the offering, Abengoa has contributed to Abengoa Yield ten concessional assets, certain holding companies and a preferred equity investment in ACBH (a subsidiary of Abengoa engaged in the development, construction and management of transmission lines in Brazil). In exchange for this asset transfer, Abengoa has received a 64.28% interest in Abengoa Yield and US$779.8 million ( million) in cash, corresponding to the net proceeds of the initial public offering after deducting underwriting fees and all the expenses related to the initial public offering. As a result of the Initial Public Offering, Abengoa has recorded Non-controlling interest amounting to million, corresponding to the book value of the 35.72% stake in Abengoa Yield sold and an impact in Equity amounting to 86 million, for the difference between the net proceeds and the book value of the net assets transferred Main acquisitions and disposals a) Acquisitions There were no significant acquisitions during the nine month period ended September 30, b) Disposals On May 2, 2013 the Company signed an agreement with Corning Incorporated to sell its Brazilian subsidiary, Bargoa S.A., a company which manufactures telecommunications components. The transaction price was set at US$80 million. This sale brought Abengoa a cash inflow of US$50 million and generated an after-tax profit of 29 million. On June 13, 2013 Abengoa signed a strategic agreement with the European private equity fund, Triton Partners (Triton), to sell 100% of Befesa Medio Ambiente, S.L.U. Note 7 on Discontinued operations and Non-current assets held for sale gives further details on this transaction Business combinations During the nine month period ended September 30, 2014, no significant business combinations were carried out by the Group. Regarding 2013, on October 13, 2013, Arizona Solar One, LLC, the Company that holds the assets in Solana thermo-solar plant in the United States, which was recorded under the equity method during its construction period, entered into operation and started to be fully consolidated once control over this company was gained. The Company reassesses whether or not it controls an investee when facts and circumstances indicate that there are changes to the elements that determine control (power over the investee, exposition to variable returns of the investee and ability to use its power to affect its returns). The Company concluded that during the construction phase of Solana plant all the relevant decisions were subject to the control and approval of the Administration. As a result, the Company did not have control over these assets during the construction period. IFRS 10 (B80) establishes that control requires a continuous assessment and that the Company shall reassess if it controls the investee if facts and circumstances indicate that there are changes to the elements of control. Once the project entered into operation, the decision making process changed, the investee was controlled and it started to be fully consolidated. This business combination was recorded in accordance with IFRS 3 Business combinations with no material impact in the Consolidated Income Statement.

28 28 The amount of assets and liabilities consolidated is shown in the following table: As of October 13, 2013 Non-current assets 1,522,152 Current assets 7,774 Non-current and current liabilities (1,117,349) Net Investment (412,577) Total - Note 7.- Discontinued operations and Non-current assets held for sale 7.1. Assets held for sale -shares in BCTA Qingdao, S.L. As of December 31, 2013 and September 30, 2014, the Company is in a process of negotiations to sell its 92.6% interest in Qingdao BCTA Desalination Co., Ltd. ( Qingdao ), a desalination plant in China. Given that as of that date the subsidiary is available for immediate sale and the sale is highly probable, the Company has classified the assets and liabilities of Qingdao as held for sale in the Consolidated Statement of Financial Position both as of December 31, 2013 and September 30, Until closing of the sale transaction, the assets will be reported as held for sale in accordance with the stipulations and requirements of IFRS 5, Non-Current Assets Held for Sale and Discontinued Operations. The expected cash proceeds will be approximately 50.1 million. As of September 30, 2014, the agreement is subject to certain closing conditions. As of September 30, 2014 and December 31, 2013, the breakdown of the assets and liabilities classified as Held for Sale, are as follows: Balance as of Balance as of Assets Fixed assets in projects (project finance) 146, ,067 Financial investments 8 16 Deferred tax assets Current assets 49,632 27,888 Total assets 196, ,403 Liabilities Long-term non-recourse project financing 99,332 95,460 Current liabilities 38,816 25,809 Total liabilities 138, ,269

29 Assets held for sale -shares in Linha Verde Transmissora de Energía S.A. The Company has signed with Centrais Elétricas do Norte do Brasil S.A (Eletronorte) a share purchase agreement to sell its 51% stake in Linha Verde Transmissora de Energía S.A. ( Linha Verde ), a company with a concession of an electric transmission line in Brazil which is currently in pre-operational stage. As of September 30, 2014, the sale is subject to the closing conditions customary for the sale of these types of assets. Given that as of that date the subsidiary is available for immediate sale and the sale is highly probable, the Company has classified the assets and liabilities of Linha Verde as held for sale in the Consolidated Statement of Financial Position as of September 30, Until closing of the sale transaction, the assets will be reported as held for sale in accordance with the stipulations and requirements of IFRS 5, Non-Current Assets Held for Sale and Discontinued Operations. The expected cash proceeds will be approximately 40 million Brazilian real (approximately 12.9 million). As of September 30, 2014, the breakdown of the assets and liabilities classified as Held for Sale, are as follows: Balance as of Asstes Fixed assets in projects (project finance) 169,981 Deferred tax assets 867 Current assets 5,220 Total assets 176,068 Liabilities Long-term non-recourse project financing 120,991 Current liabilities 31,930 Total liabilities 152, Sale of shares in Befesa Medio Ambiente, S.L.U. On June 13, 2013 the Company reached an exclusive agreement with certain investment funds managed by Triton Partners to wholly transfer Abengoa's shareholding in Befesa Medio Ambiente, S.L.U. The agreed sale price was 1,075 million (considering the net debt adjustments, total consideration to Abengoa amounts to 620 million). The sale of this shareholding involved a cash deposit of 331 million. The balance of the agreed payment, to complete the aforementioned figure of 620 million, consisted of a deferred payment of 17 million ( 15 million held as a deposit until ongoing litigations are resolved and two million Euros in long-term receivables from a client of Befesa Medioambiente), a credit note of 48 million to mature in five years and a deferred payment of 225 million through a convertible loan with 15 years maturity and subject to two extension options of five years each at the discretion of the venture capital fund. The loan's principal shall be settled with a single repayment at maturity and accrues interest at the 6-month Euribor, plus a 6% spread, with an option for the fund to capitalize or pay interest at the end of each accrual period. Certain triggering events, which include Befesa's insolvency, a maximum net debt/ebitda ratio of 8.0 throughout the life of the convertible loan, and failure to meet certain financial objectives in the last three years of the 15-year loan (minimum expected operating cash flow, minimum cash coverage ratio of 1.3) would result in the automatic conversion of the loan into 14.06% of Befesa's shares. The sale transaction generated a gain of 0.4 million in the Results for the year from discontinued operations, net of taxes in the Consolidated Income Statement for the year 2013.